You need to know how to avoid being ripped off when you use your credit card abroad to prevent nasty shocks when you get home and receive your statement. When you are on vacation and in the mood to spend some money, there’s no doubting that the easiest way to do this is just to whip out your credit card and slot it into the machine, just like you do at home. The thing is, being in a foreign country means that not all the same rules and regulations apply to card transactions. What is a simple process at home might be something more complicated and expensive than you ever thought when abroad. To ensure that you have the best financial experiences possible when you are on vacation, here is how to avoid being ripped off when you use your credit card abroad!
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1. Be Mindful of Foreign Transaction Fees
The majority of credit card companies issue charges when they see that you are paying in foreign currencies. They are on top of the exchange rate and they can vary drastically from card to card. Before you whip yours out to pay for things on holiday, make sure you have done your research about the extra fees and then you can decide whether one card will be better to pay with than another.
2. Section 75
Most credits cards offer Section 75 protection, which means they are liable as the card issuer if something goes wrong, for example, you buy faulty goods and the foreign retailer refuses to reimburse you. You can get cover for amounts between £100 and £30,000, which can offer important peace of mind for things like hotels and flights.
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3. Pay in Local Currency
You might want to consider paying in local currency as it is often the cheaper alternative. When a store or restaurant asks you which you would prefer, choose local because the card issuer will have to carry out the conversion rather than the retailer. This is recommended because credit card company conversion rates are usually much more appealing than retailer rates. Follow these simple steps and you should be absolutely fine!